Nigeria’s crude oil production from the Niger Delta region of the country situated next to the Gulf of Guinea is set to increase notwithstanding persistent disruptions from militant’s attacks.
These are the views of many experts and analysts in the oil and gas industry in Nigeria. Also from factual data’s collated and released by Organization of Petroleum Exporting Countries (OPEC) monthly oil market report.
It is common knowledge that the volume of Nigeria’s crude production has been in a downward decline since President Buhari defeated Goodluck Jonathan, a Niger Delta indigene in a keenly contested presidential election in 2015.
Buhari’s Presidency under a new party styled the All Progressive Congress has face serious militants threat and attacks focused on the nation fledging oil and gas assets consisting of oil and gas pipelines , flow stations and terminal buildings .
These critical assets of the nation are being vandalized and destroyed on a daily basis by various self-style militants groups operating in the Niger Delta. Chief among this dreaded monster is the Niger Delta avengers.
It is recall that the activities of these militants were contained and managed by the past successive federal government of President Yaradua and Good luck Jonathan. However the inability of the present government to agree to their demands have opened a new wave of militancy. The Niger Delta militants are protesting that they are being exploited and are demanding for a higher percentage of the oil wealth to be given to them since they bear the full brunt of oil spills and environmental degradation in the areas of operation.
Unfortunately the resurrection of militancy activities under the present government has done serious damage not only to the infrastructural assets of the nation but most importantly to its revenue and her economy. It is established fact that Nigeria is now officially in a recession for the second consecutive financial quarter of 2016.
It is a fact that crude oil sales accounts for 70% of Nigerian government revenue. It also accounts for 95% of export revenue in terms of earning foreign exchange and contributes about 15% to the nation’s GDP. Therefore any decrease in production of the Mineral resources will affect the nation revenue base and by extension her foreign exchange.
Long before 2015 when crude oil was discovered in Oloibiri, in Rivers State. Crude oil production in Nigeria started at a modest volume of just 1,899.12 barrels per day (BPD) in 1973. In 1983 the production level of Nigeria’s oil was 657,000 BPD. By mid-2001 Nigeria’s crude oil production was averaging 2,200,000 BPD. Oil production reached a peak of 2,475,000 BPD in 2015 one of the highest production level in the nation’s oil history.
This high expectation was to change to the worst, thanks to the persistent militant’s vandalisation of major export pipelines and terminals in Nigeria. Nigerian crude oil exported from her various terminal bearing the crude‘s names include Akwa Iboe Terminal owned and run by Mobil producing from Akwa Ibom State. The Escravos Terminal owned and operated by Chevron in Delta State
The Brass Terminal about 113 kilometres from Port Harcourt owned and operated by Agip Oil. The Forcados Terminal owned and run by Shell Petroleum in Delta State and the Pennington Terminal owned and operated by Texaco Oil.
These militants’ attacks and willful destruction of oil and gas pipelines and installations has succeeded in reducing the crude oil production levels in Nigeria. This has cause Nigeria to lose about 750,000 barrels per day of crude as at May 2016 the highest reduction of oil production since 2009.
The continued disruption through attacks and vandalism of critical oil and gas assets of the nation has impacted negatively in the production level of Nigeria to the extent that Nigeria who was OPEC Africa’s largest oil producer lost this enviable position to Angola earlier this year.
The beginning of year 2016 witnessed dangerous decline in the production data of the Nation crude oil as released by the NNPC. In January 2016, Nigeria daily crude oil production was 1,757 Million BPD. In February it recorded 1.4 million BPD and in March it was 1,505 Million BPD. In the month of April it was 1,570 Million BPD and 1,506 Million BPD in May. In June it was 1,379 Million BPD, and 1,270 million BPD in July. In August it was 1,104 Million BPD, 1,253 Million in September and 1,476 Million BPD in October 2016.
However, the good news is that the production level is projected to rise to about 1,900 Million BPD in the month of November 2016.The rise in Nigeria’s crude production was hinged on the Forcados ‘s crude oil stream resuming production at the end of September 2016 for the first time since February 2016. It was expected that it will contribute about 230,000 barrels of oil a day. The Forcados terminal is operated by Shell Petroleum in Delta State.
Also expected to come on stream by the end of September 2016 is Exxon Mobil who were expected to commence export of Qua Iboe grade crude oil through its Terminal in Ibeno, Akwa Ibom State.
Despite frequent disruptions on production timeline by the notorious Niger Delta Militants, Nigeria crude oil production is said to remain resilient. It is expected that by the time most of the vandalized oil facilities are repaired before the end of 2016, crude oil export will increase by 575,600 barrels per day.
On November 23, 2016 Nigeria’s Minister of State for petroleum Mr Ibe Kachikwu was quoted as saying that Nigeria crude oil output has risen to around 1.9 Million Barrels per day. Kachikwu acknowledged the fact that though progress is made by the increase in production from an all-time low in the beginning of the year, much still needs to be done to get Nigeria to her budgeted production ceiling of 2.2 million BPD.
He regretted that the vandalisation of oil and gas pipelines has cost the nation much in harnessing her expected revenue and fulfilling her vision in this financial year. He was however optimistic that the issue of militancy in the oil rich Niger delta will be settled amicably by the federal Government of Nigeria once and for all.